The former Sweden international has been a free agent since his two-year spell with LA Galaxy came to an end, after netting a staggering 53 goals in 58 games for the MLS club.
Ibrahimovic had been linked with Tottenham before Jose Mourinho ruled out a move, and now the legendary forward’s future has been decided, according to the Telegraph.
He has allegedly penned a deal with Milan where he will stay until the end of the season aiming to fire the Rossoneri up the Serie A table.
Ibrahimovic began his first spell with Milan in 2010 after joining on loan from Barcelona. The move would eventually become a permanent one and he scored 56 times in 86 games.
In summer 2012, Ibrahimovic departed Italy for Paris Sain-Germain, later going on to play for Man United and then LA Galaxy.
Speaking last month, the 38-year-old insisted he could still have an impact at the highest level of the game.
“I know I could make the difference, both in Italy and in any other country,” he said. “I’d do better than the players who are there playing now.”
Last week, a statue dedicated to the forward was set on fire by Malmo fans following the news Zlatan had become co-owner of their rivals Hammarby.
In October, Ibrahimovic was honored with a 9ft statue, which was created by Swedish artist Peter Linde, outside the stadium of Malmo.
News that he has invested in their bitter rivals has not gone down well with fans of his first professional club and they made their feelings clear by pouring lighter fluid on the Zlatan statue last week and using flares to set it alight, having earlier hung a toilet seat from it.